According to Statistics Estonia, in September 2010 the production of industrial enterprises grew 31% compared to September of the previous year. This year the growth of production has mainly influenced by the increase in external demand, since domestic market has slightly livened up only during the last months.

The moderate growth reported at the beginning of 2010 was followed by a rapid increase in spring; and in June, July and August enterprises gave over 20% more production than in the corresponding months of 2009.

The production of manufacturing increased 32% compared to September 2009. Export sales of the manufacturing production increased significantly (54%). Nearly 70% of the whole production of manufacturing was sold on the external market. The demand on the domestic market was considerably lower — the domestic sales increased 7% compared to September of the previous year.

In September, the production exceeded the volume of the previous year in most branches of industry. The growth in the production of manufacturing was most influenced by the branches holding bigger shares — manufacturing of electronic products where the production increased by more than one and a half times, and manufacturing of wood where the growth was 25%. With respect to the branches of manufacturing holding smaller shares, the production increased considerably in the manufacturing of motor vehicles, machinery and equipment mainly due to the increase in exports. The rapid growth in production was partly also influenced by the low reference base in 2009; this effect will last until the end of 2010. Regardless of the rapid increase, the industrial production just reached the level of 2005.

In September 2010 compared to August, the seasonally adjusted industrial production rose 4%; the production of manufacturing grew 5%.

In September 2010 compared to September 2009, the production of electricity increased 41% and the production of heat 15%. The increase in energy production was mainly caused by a growing demand for energy induced by more active manufacturing as well as by the growth in the exports of electricity.

The volume index and trend of production in manufacturing, January 2000 – September 2010 (2005 = 100)

According to Statistics Estonia, in September 2010 compared to September of the previous year the retail sales of goods of retail trade enterprises increased 1% at constant prices. The decline in retail trade enterprises that had lasted for nearly two and a half years turned to a rise again in September this year.

In September, the retail sales of goods of retail trade enterprises were 4.5 billion kroons (288 million euros). Compared to September 2009, the retail sales of stores selling manufactured goods recovered significantly. It turned from decrease to increase and grew by 4%. The retail sales of other specialized stores, such as stores selling computers and their accessories, photography supplies, books, sports equipment, games and toys, etc., recovered remarkably. In those stores the retail sales turned from decrease to increase after 2 years of decline, growing 11% compared to September 2009. The sales in stores selling household goods and appliances, hardware and building materials also slightly recovered, but the retail sales of these stores could not gain growth yet in yearly comparison — the retail sales in these stores fell 7% compared to September 2009. Compared to September of the previous year, the retail sales of goods increased also in the retail sales in non-specialized stores with industrial goods predominating (17%), the retail sales of second-hand goods in stores (16%), the retail sales in stores selling textiles, clothing, footwear and leather goods (10%) and the retail sales of pharmaceutical goods and cosmetics (7%).

The retail sales in grocery stores stayed at the same level compared to the September of the previous year. The growth in sales volume in these stores was retarded by price increase of food products that had accelerated in September.

Compared to the previous month, the retail sales in retail trade enterprises decreased by 8% at constant prices. According to the seasonally and working-day adjusted data the retail sales decreased by 1%. During the nine months of 2010 (January-September), the retail sales in retail trade enterprises decreased 6% at constant prices compared to the corresponding period of the previous year.

In September the revenues from sales of retail trade enterprises were 5.6 billion kroons (360 million euros), out of which retail sales of goods accounted for 80%. Compared to September of the previous year, the revenues from sales increased 8% at current prices. Compared to the previous month, this indicator decreased 6%.

Several companies of the Norwegian Orkla group market products of the Estonian Kalev Chocolate Factory in the Baltic countries, Russia and the Nordic countries.
Kaido Kaare, CEO of Kalev Chocolate Factory, told BNS that in order to increase export volumes Kalev had started to co-operate with several companies of the Orkla Group. “Our most important export target countries are the Baltic countries, Russia and the Nordic countries.”
Kaare said that Kalev had launched co-operation with the Finnish Panda sweetmeats producer. “In the framework of that co-operation, Panda markets Kalev’s products in Finland and Kalev respectively Panda’s products in Estonia.”
In the St. Petersburg area of Russia, Kalev launched co-operation with Krupskaya, a company in the Orkla group. “Via Krupskaya’s contacts Kalev has wider opportunities to get its products into the assortment of big Russian retail chains.”
He said that Kalev had established its first contacts also with K’oKo’, a company of the Orkla group operating in the Czech Republic.
From November 1 Spilva, a fruits and vegetable processor in the Orkla Group, will take over Kalev products’ distribution, sale and marketing operations in Latvia.
Orkla acquired Kalev Chocolate Factory this May.

Nordea Eesti earned 335.6 million kroons (EUR 21.5 mln) of net profit in nine months, more than threefold the sum it earned in the same period last year. The total revenue of Nordea Eesti, a company in the Nordea financial group, grew by 30% during the nine months, totalling 827 million kroons.
The loan losses in the nine-month period fell from last year’s 272 million kroons to 179 million kroons in the same period this year.
“Growth of Nordea’s profit by several times was due both to stable growth in revenues as well as contraction in loan losses, and in the stabilisation of the economy growth in Nordea clients’ activity in using our products and services has clearly been seen,” CEO of Nordea Eesti Vahur Kraft said. He added that in terms of its assets Nordea was among the three biggest banks in Estonia.
The sum total of Nordea Eesti assets grew 8% compared with the same period last year and added up to 48.4 million kroons as of the end of September. The loan portfolio of the bank amounted to 43 billion kroons as of the end of September, growing by 4.3% on year.
Companies’ loan and leasing portfolio of Nordea Eesti amounted to 26 billion kroons as of the end of September, up 3% compared with the same years. The private persons’ loan and leasing portfolio grew by 4% on year and amounted to 14.7 billion kroons as of the end of September.
As of September Nordea Eesti had 145 488 clients, 22 offices, 100 ATMs, and 531 employees. As of the end of the quarter the bank had issued 84 908 bank cards and had 91 386 internet banking clients.

BBN asked Heili Haabu, attorney at law of Luiga Mody Hääl Borenius, to explain what businessmen who plan to set up a new company from the start of next year need to keep in mind.

On starting a business, the founders face the question of which legal form to use and what is the best way to conduct company business. In light of the constantly changing Commercial Code, the answers to those questions might not be the same today as they were last year or a couple of years ago.

Private limited company or public limited company?

When choosing the legal form most suitable for business, the founders’ basic choice is between a private limited company and a public limited company. The Commercial Code regulating the management of these two types of company is becoming ever more flexible, so that today we cannot say that, in the case of a larger circle of founders and a larger investment, the form of a public limited company is absolutely justified, as is commonly believed. The draft Act on amending the Commercial Code, entering into force on January 01, 2011, will further enable founders to design a private or public limited company to meet their needs.

A new retail survey shows that shoplifters in the Baltic states cause retailers to lose 1.4% of revenues. This is third-highest rate in Europe behind Russia (1.61%), Turkey (1.52%) and on par with the Czech Republic (1.4%), according to ERR.